Small Business to USPS: Support the Businesses You Claim to Serve, Produce a Sustainable Business Plan

The sad financial story of the U.S. Postal Service remains the same. The agency continues on a downward spiral of poor fiscal management, as it recently announced a loss of $2.1 billion in the latest quarterly report. This significant sum of money, combined with losses posted in February, amount to $3.6 billion in losses for the first half of its fiscal year, nearly matching the full amount lost ($3.9 billion) in all of 2018.

The grave financial condition of the USPS only affirms the view of small business owners that this critical agency knows very little about running a significant operation, one that many happen to depend on to run their businesses.

The pace of USPS’ growing red ink this year substantially eclipses the losses for the same time period in previous years. USPS lost $1.8 billion in the first half of 2018 and $762 million during the same time period in 2017. And, unfortunately, USPS leadership, headed by Postmaster General Megan Brennan, has yet to produce a strategy for orienting its product offerings in a rational manner, which would help to establish a sustainable financial path and for delivering value to its customers.

In a recent hearing on the matter, members of Congress became visibly frustrated by the absence of a true business plan: “How long are we going to have to wait for a plan to come from the board, Ms. Brennan?” asked Rep. Mark Meadows (R-N.C.). “We’ve been dealing with this; it’s been in crisis mode for two or three years.”

Successful ventures, entrepreneurs, small business owners and organizations always have a plan.  Neglecting to formulate a clear business plan – and updating that strategy on a regular basis – is a plan for failure. It is inexcusable that an organization as large as USPS is operating without a strategic roadmap that includes key benchmarks and revenue goals.

In the latest 2018 report card on USPS performance, the agency’s regulating body found that the Postal Service did not meet or only partially met each “performance goal” in the 2018 fiscal year. Major difficulties pointed out by the report include areas such as “High-Quality Service” and “Excellent Customer Experiences.” In an age when customers have high expectations for service and for businesses to “meet them where they are,” entrepreneurs and small businesses are especially concerned about how poor USPS service impacts and reflects on their operations, customer experiences and brands.

In 2018, the Postal Service did not meet on-time delivery targets for every single product segment within its “First-Class Mail” umbrella of services. This pitiful reality affects the competitiveness and bottom line of many small businesses. It impacts their ability to effectively communicate with customers, promote products, market their businesses, fulfill orders, complete billing, invoicing and much more. Not everything and everybody operates in the digital economy (at least not yet).

At the start of 2019 the price of stamps shot up drastically; a historic 10 percent increase. Small businesses don’t always have the financial flexibility to seek other mailing options. No doubt USPS will take another swing for the fences on a massive price hike in the future, but how much can small businesses reasonably withstand? Many are stuck paying considerably more for deteriorating services. This vicious cycle is not sustainable for USPS, and certainly will not work for small businesses.

Small business owners know how important it is to “track the P&Ls”, or profit and loss statements, of their firms. Knowing the “P&Ls” is a fundamental necessity for business success and growth. But guess what? USPS does nothing of the sort, and worse, it has resisted it for years.

The Postal Service’s accounting methods are largely opaque. This needs to change. In order for the USPS to apply reasonable pricing strategies, and not use letter mail revenues to subsidize package deliveries, it needs to get a handle on the financials.

Practical adjustments that include USPS balance sheet transparency, clarity, and logical product segmentation is well within reach. Lawmakers and USPS leaders would be wise to act on this – to demand this – in order to provide small businesses, and all customers, with the service they expect and deserve both now and into the future.


Karen Kerrigan is president and CEO of the Small Business & Entrepreneurship Council.

Morning Consult welcomes op-ed submissions on policy, politics and business strategy in our coverage areas. Updated submission guidelines can be found here.

Morning Consult